City Dreams

Village People on the Move

Hamburg Horst Götschel
Hamburg´s harbor area is one of the in places where there has been a lot of development, adding to the attractiveness of the city.
  • Why it matters

    Why it matters

    Germany´s housing market seems out of control: Young people are moving to the country´s biggest cities where rent is rising fast – while smaller towns are shrinking dramatically despite the continously cheaper cost for accomodation.

  • Facts


    • Rental prices for apartments are rising dramatically: in the first half of 2014 they rose by 5 percent in Berlin.
    • Despite expectations, high rents in some cities don’t reduce their appeal; nor do available jobs in shrinking cities.
    • American sociologist Richard Florida said art and culture do more to make cities appealing than jobs.
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Sixty-four-year old Rita Weschenbach staged her protest in an allotment amongst her kiwi plants and beehives. She planted a wooden sign. “Property sharks are stealing my garden. They’re clearing land for construction.” Although the quiet allotment outside Hamburg smells like apple trees now, excavators will soon change that. They will clear the space currently used by 330 allotments, as part of a plan to build 1,400 new apartments.

The same drama is taking place up and down the country as renters fight landlords, city planners oppose investors, and ecowarriors fight evictions. The German government is planning to cap rental prices to keep living space affordable. But this week they agreed that this regulation does not apply to new homes, so investors continue to build.

While the German population overall isn’t growing very fast, in many urban areas rents are rising rapidly, because young people are rushing to live in the cities.

“The German population isn’t growing very fast, but rents in urban areas are rising rapidly, because young people are rushing to live in the cities.”

Jutta Blankau, Building Senator, Hamburg

Harald Simons, a real estate researcher at Leipzig’s University of Applied Sciences said this is because young people are moving to Berlin, Hamburg and Munich but also to smaller ones like Würzburg, Leipzig, Mainz and Bamberg. The people he is talking about are particularly in the age bracket between 20 and 35. This is a new type of migration, Mr. Simons said.

And it is creating problems, for the towns and areas which are shrinking and for the in-places which are growing. Cities can react in one of two ways. They either accommodate the young folk crowding to town, which results in a housing boom like in Hamburg. Or they try to divert the swarm – though many researchers don’t believe that’s possible.

Hamburg is a great example of the dynamic in action without political steering. Every year, more people moved there; in 2013 it grew by 12,000. At first, too few houses were built – then only luxury apartments. Rents have shot up 40 percent since 2007.

It isn’t just students who are flooding the urban areas, young people are rushing to the towns whether they study or not. And the strange thing is: The market is not correcting the trend – you might think eventually the rising prices would put people off. But that is not the case.

Jutta Blankau, Hamburg’s building senator, said Hamburg has tried to counter the trend with a mix of incentives and penalties since 2011. “The market didn’t correct the situation, so now we’re taking action.”

Each year, the city will build 6,000 new homes. The strategy assumes that if more apartments ease the housing demand, prices will fall.

Now it’s a question of making sure there are enough empty spaces for all the construction sites, and ensuring that the building permits can be handed out.

Source: Klaus Ehlers
The city center of Hagen. Source: Klaus Ehlers


It seems that Ms. Wenschenbach’s allotment protest is not likely to succeed. In the past, well-organized residents protected their neighborhoods and the land nearby. Now city councils face pressure and incentives to help out the people searching for homes.

The city halls have a clear mandate to make sure that of the houses planned for the allotment area outside Hamburg, a third should be affordable, a third regular rental homes and a third for sale. The city council is also calling on land owned by private investors to ensure construction is in a similar balance of these three goals.

It is early days but already, rents fell by 0.6 percent in the first half of this year. “The trend has changed at last,” said Roman Heidrich from JJL, a firm specializing in real estate.

Germany might be aging but in Hamburg, the average age is expected to fall by 2030, according to statisticians.

This trend towards youthfulness is shaping the character of the city as some neighborhoods attract young artists and students as well as the demographics in the towns where young people are moving away too.

Take a shrinking city like Hagen, a small town, but 41st-largest city in Germany, which is located in state of North Rhine-Westphalia. After reunification, the city had 215,000 inhabitants; now the population is only 188,000 and experts say a similar shrinkage is ahead in the next 16 years. The number of 16- to 25-year olds is likely to fall by more than 35 percent. There are empty streets and despite very low rents, the market has as little effect there as it does in Hamburg: people are flocking from the former to the latter.

Graffiti art in the city of Halle. Source: DPA

Low rents might not help attract even low earning students; nor, it seems, do jobs. Despite Hagen’s lower than average unemployment rate of 8.5 percent, people are still moving away from the town.

In a place like Hagen, city officials are starting to see themselves as managing the contracting of the city and limiting damage by making sure the center does not look to empty, for example. Some make the mistake of encouraging the construction of big centers outside the city; this is exacerbating the disintegration of town centers while failing to attract new residents. Often, this makes the situation worse.

Do young people determine cities’ fortunes, without it even being clear why they’re flocking to certain cities and shying away from others?

The trend in another city, Halle a small town in the southern part of the German state Saxony-Anhalt has succeeded in reversing the trend of young people leaving the city. They have set up festivals and opened a neighborhood store and a city garden. Rents are rising again and students are moving back to town. The city mayor noted a new specialty of the city: the trend for “spontaneous parties.”

It is still unclear what is driving these changes. Mr. Simons believes it is due to the numbers. “There are fewer and fewer young people. They’re doing what all minorities do and banding together.”

At the same time, he said, the young people face a very difficult employment market and have decided that work matters less than their personal happiness. They look for jobs to fit suit their lifestyles, rather than the other way round.


This article first appeared in Die Zeit. To contact the author:

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